By Connor Smith |
Friday, March 3
Green
Day. All 11 S&P
500 sectors rose today as the major indexes snapped their
recent weekly losing streaks.
The Dow Jones Industrial Average rose
1.2%, or 1.8% on the week. The latter snapped a four-week losing streak. The
S&P 500 rose 1.6%, or 1.9% on the week. It snapped a three-week skid of its
own. The weakest S&P 500 sector of the day was consumer staples, which
ticked up less than 0.1% higher.
The Nasdaq Composite rose nearly 2%
to rise 2.6% on the week. It's risen in seven of the past nine weeks.
The gains for tech stocks followed a slide in
the 10-year Treasury yield to 3.966%. Growth-oriented stocks tend to fall when
long-term rates rise because it lowers the value of future profits.
The shifts for stocks followed the ISM
services index for February, which was down slightly from January to 55.1.
Economists had expected it t clock in at 54.5, according to FactSet.
Oanda analyst Edward Moya caled the ISM
reading impressive, noting it "suggests that part of the economy remains
healthy." He also notes that traders are likely reacting to a trickle of
commentary from Federal Reserve officials this week.
"Wall Street has had a lot of Fed speak
to digest over the past week, but it seems clear that traders believe we are
very close to the peak despite all these signs of a resilient economy,"
Moya writes.
Still, Barron's associate editor Randall
Forsyth notes
that the economy will face a tougher bar as February data rolls out. Randy
writes:
Based on the data at hand, the economy
continues to lumber ahead. But that might reflect monthly indicators that may
be seasonally maladjusted. All of which makes the coming numbers for February
perhaps more telling, especially for the Fed policy makers due to meet on March
21-22.
Randy points to next week's jobs report, where
nonfarm payrolls are expected to rise by 215,000.
Absent a major negative shock, the Fed is
likely to raise its fed-funds target range by another quarter percentage point
later this month, from its current 4.50%-4.75%. More important will be whether
the central bank raises its year-end expectation from December’s 5.1% median. Coming
data may determine how things turn, turn, turn.
Watch our
weekly TV show on Fox Business Saturday or Sunday at 10 a.m. or 11:30 a.m. ET.
This week, NYU Stern's Aswath
Damodaran on how to make sense of stock valuations as
yields rise.
DJIA: +1.17% to 33,390.97
S&P 500: +1.61% to 4,045.64
Nasdaq: +1.97% to 11,698.01
The Hot Stock:
Communication
Services +2.2%
The Biggest Loser: Hormel Foods +2.2%
Best Sector: Utilities +1.9%
Worst Sector: Consumer Staples +0.1%
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